Summary of Interim Report for 1 January - 30 June 2014: 87M visits (+22% YoY)

Following information was previously published in Swedish. This is a summary of the Swedish report.

203 Web Group's Interim Report for 1 January – 30 June 2014 is now published and available at www.203webgroup.com under Investor - Financial Reports.

SUMMARY OF Q2 2014 (2013)

* Net Turnover: 12 469 KSEK (12 814)
* Operating Profit/Loss (EBITDA): -3 532 KSEK (2 654) 
* Operating Margin (EBITDA): n/a (20,71 %)
* Earnings After Tax: -5 130 KSEK (1 462)
* Earning per share: 0,31 SEK (0,10)

SUMMARY OF Q1-Q2 2014 (2013)

* Net Turnover: 24 577 KSEK (23 577)
* Operating Profit/Loss (EBITDA): -5 472 KSEK (3 709) 
* Operating Margin (EBITDA): n/a (15,69 %)
* Earnings After Tax: -7 316 KSEK (1 449)
* Earning per share: -0,45 SEK (0,09)

Significant events

During the period
* Divestment of Bilweb AB with a view to streamlining the business. The purchase consideration was SEK 4 million.
* 203 Brands AB invested SEK 1,500,039 in Shopello International AB via a new share issue. This increases the shareholding in the company by 243 shares, corresponding to 9.38%. In addition, 203 Web Group acquired a further 18.18% of the shares via a non-cash issue valued at SEK 1,999,986, in the form of shares in 203 Web Group. Following these transactions, the Group holds a total of 79.56% of the shares in Shopello. 
* Premium sales 2.4 MSEK, up 276% from Q2 previous year.

After the period
* Changed trading venue to Nasdaq OMX First North Premier.
* Jonas Söderqvist new CEO of 203 Web Group. At the same time, Andreas Friis became Chairman and CFO Robert Zettervall took up the position of Deputy CEO.
* Former Head of Operations Martin Lilliestierna became CEO of 203 Brands.
* In September, Aage Reerslev, founder of Wrapp, will join the Group as CEO of myTaste.

CEO Jonas Söderqvist comments:

It is pleasing to report that the growth in traffic on myTaste remains stable, and has accelerated ahead of the seasonally strongest period of our year. This paves the way for new traffic records. New in this report is a presentation – on page 7 in the Swedish report – of our goals for traffic and membership growth up to year-end. To further increase the rate of growth at myTaste, we are evaluating options such as a capital injection, strategic partnerships and M&A transactions. Our decisions to dispense with video advertising during Q2 2013 and to reduce our advertising space by 70% during Q4 2013, in favour of more relevant and qualitative advertising, have now proved to be strategically apt.  In the short term, we witnessed a decline in RPV (revenue per visit), but now the levels have started to move higher again as premium sales are up 276% (2,4 MSEK) compared to the same peroid previous year.

Shopello, too, is expanding steadily, with growth in the number of affiliated stores and partners. It has also started work on establishing an international sales organisation in Barcelona in an effort to further stimulate store and partner growth.

This quarter, we are reporting a weaker result than last time, owing to higher costs incurred by the parent company in converting to IFRS, the change of trading floor to First North and the demerger of myTaste into a separate company. 203 Brands also recorded increased costs, in connection with the sales of Bilweb, which impacted negatively on earnings.

Elsewhere, we are continuing to invest in our portfolio companies, above all myTaste, where we identify further excellent opportunities for stepping up the rate of growth. We are now developing our myTaste app, which we hope will be ready for a Q4 launch. Our expectations are that this will help to stimulate growth in membership on the basis that a mobile-compatible product is an essential condition for converting mobile traffic. Today, roughly 50% of our traffic originates from mobile devices, but membership conversions from them are very nearly non-existent. Because mobile traffic continues to show steady growth, we view the app and a mobile-compatible site as value-building in the long term.  

Jonas Söderqvist, CEO
203 Web Group AB (publ)
jonas.soderqvist@203webgroup.se
+46 732 512 203 

About 203 Web Group AB (publ)
203 Web Group is a publicly traded Swedish media group operating sites in 50 countries. 

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